Court gives liquidators green light to claim 3AC assets
U.S. Bankruptcy Judge Martin Glenn gave liquidators authority to subpoena and lay claim to bankrupt crypto firm Three Arrows Capital (3AC)’s U.S-based assets on Tuesday.
See related article: 3AC crypto contagion spreads to Blockchain.com: report
Fast facts
- Liquidators can subpoena two dozen banks and crypto exchanges to obtain information about the bankrupt crypto hedge fund’s assets and transfers.
- Permission was also granted to subpoena 3AC cofounders Su Zhu and Kyle Davies, though the pair did not appear in court on Tuesday, and their whereabouts remain unknown.
- This has hindered liquidators’ efforts to get a complete view of the situation and creates a risk the pair could move digital assets unless courts directly intervene, liquidators’ lawyer Adam Goldberg said.
- 3AC filed for Chapter 15 bankruptcy on July 1 shortly after reportedly being ordered into liquidation by a British Virgin Islands court in late June.
- Voyager Digital Ltd. filed for Chapter 11 bankruptcy recently after disclosing it had loaned US$670 million in cryptocurrencies to 3AC while Blockchain.com recently disclosed it’s also at risk of losing US$270 million it had loaned to 3AC.
- Luna/Terra’s collapse had a significant impact on 3AC which had a US$200 million investment in the organization behind the now-defunct stablecoin.
See related article: Bitcoin, crypto fall amid reports of 3AC’s court-ordered liquidation